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(20 Feb 2025, 11:51)

Rural demand continues to hold up on increasing farm incomes

The Reserve Bank of India (RBI), stated in its monthly update that India’s industrial activity has recorded an improvement over the previous quarter, as reflected in the Purchasing Managers’ Index (PMI) in January. Pick-up in tractor sales growth, and fuel consumption, and sustained growth in air passenger traffic also point to a recovery in overall momentum. Rural demand continues to hold up, buoyed by increasing farm incomes. In rural areas, sales of fast-moving consumer good (FMCG) companies grew by 9.9 per cent in Q3:2024-25, much higher than 5.7 per cent in Q2. Urban demand also exhibited a recovery with 5 per cent growth in Q3, being nearly double of 2.6 per cent in the previous quarter. The enterprise surveys conducted by the Reserve Bank corroborate this assessment.
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